Quote and Charts of the Day: The Mere Mention

The mere mention by a Fed governor of what Fed Chair Powell refused to mention during Wednesday’s press conference has sent stocks into a minor tizzy this morning, the dollar into serious rally mode, and yet, and fascinatingly, hardly anything in the bond market.


Again, stocks are taking the mention seriously (although, let’s not freak out over a <1% hit):

The dollar, which btw is due for at least a technical bounce, is not taking it lightly either (unlike stocks, a 0.7% one-day move in the dollar is big):

Treasuries, however, as I suggested above, are essentially saying “nah, it’s just noise.” I.e., any tightening of policy (tapering purchases or raising rates) would send treasury yields — at this juncture — through the proverbial roof. Until, or unless, that is, the markets believed that such tightening would actually halt the recovery in its tracks:

For today this is all about fear of less juice for asset markets, as opposed to fear over the status of the recovery…

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